Workplaces begin to offer expanded parental leave

BALTIMORE — East Coast bank M&T Bank recently announced expanded parental leave benefits for all its employees, joining a flurry of corporate parental leave expansions as employers respond to societal shifts and increasing demands on employees on the job and at home. Companies such as Accenture, Microsoft and Netflix all have announced enhanced policies in recent months. For some, it’s part of a workplace culture favoring flexibility. For others, the economic recovery and a tightening labor market, combined with an influx of millennial workers, are driving the changes.

“It is a trend, there is no questions about it,” said Bruce Elliott, manager of compensation and benefits at the Society for Human Resource Management. “Employers are starting to look strategically at what can we do to make ourselves that much more an attractive employer, especially given that millennials have started to enter the workforce and (generations) X and Y are still having children.”

“Anything an employer can do to differentiate themselves is going to make a big difference,” he said.

“An individual on paid leave is more likely to come back to work as opposed to someone not on paid leave,” Elliott said. “Companies are not doing this to be nice. This is an investment.”

A June survey of employers by the human resource society found 21 percent of U.S. organizations offer paid maternity leave — beyond what is covered by short-term disability or dictated by state law — and that the benefit has increased over the past five years. It also found 17 percent of employers offered paid paternity leave, while 17 percent offered paid adoption leave.

M&T began looking into expanding benefits last year after getting feedback from employees about the importance of work-life balance, particularly for new parents.

“As an organization, we wanted to be a role model,” said Ann Marie Odrobina, M&T’s manager of employee benefits. “We wanted to be a leader, and these things really make us a family-friendly work environment.”

The bank currently offers between six and eight weeks of paid maternity leave, depending on job classification and length of employment. The expanded benefits, which take effect Jan. 1 for eligible workers with one year of service, include fully paid leave to all primary caregivers for 12 weeks and for the first time two weeks of paid leave for secondary caregivers, including dads or same-sex spouses.

“We’ve noticed over the last several years dads taking an increasingly bigger role in child care responsibilities,” said Augie Chiasera, M&T’s president of the greater Baltimore and Chesapeake, Md., markets.

Some employees who are currently expecting or have started adoption proceedings this year will be able to get the new benefits as well.

“I do a lot of recruiting of talent, and we try to be the best place to work for families,” Chiasera said. “I see this as another indication of ongoing efforts to be the best place to work.”

The benefit, attractive for employees having children now or planning a family later, will go a long way toward retaining workers and keeping them engaged and productive, Odrobina said.

The message for employees is, she said, “We want you to take this time. It’s important you take this time, and the transition back will be more positive and productive.”

The same message has come through loudly from other employers.

— Microsoft increased its current paid parental leave to 20 weeks for birth mothers and 12 weeks for all mothers and fathers of new children. The technology giant also will allow parents to take leave in two segments and phase in the return to work.

— Consulting firm Accenture, which doubled maternity benefits this year to 16 paid weeks and enhanced paid leave for secondary caregivers, in August announced all parents won’t have to travel for a year after the birth or adoption of a child.

— Netflix went farther than most in announcing in August an unlimited leave policy for new moms and dads during the first year after a birth or adoption, though it applies only to salaried — not hourly — workers and is not expected to be widely copied.

— Another announcement came from the hospitality industry, often not perceived as family-friendly, when Hilton Worldwide said it will give all new parents two weeks of paid leave and new birth mothers 10 paid weeks off.

— Financial services firm T. Rowe Price Group has been ahead of the curve: the company updated its policy four years ago, expanding paid maternity leave to 12 weeks, including paid “child bonding time,” a four-week benefit also available to fathers and secondary caregivers.

Joan C. Williams, director of the Center for WorkLife Law at the University of California, Hastings, called the recent policy changes “a stunning development” and “one work-life advocates have been waiting for decades.”

“As the labor market has gotten tighter, one of the ways employers are competing for talent is by competing on the basis of family-friendly benefits,” Williams said. “This is a really important change. It’s a sign that employers have finally begun to believe that work-life issues really matter to their highly valued employees.”

But she called the changes long overdue and said they still pale in comparison to policies in the rest of the developed and developing world.

“Offering two weeks for dads and 10 weeks for moms is a modest step for a family-friendly workplace,” she said. “It’s a very important drop in the bucket, and the U.S. is a very empty bucket.”

Pressure to increase parental benefits is coming at a time when wages are not increasing and employers are using benefits to attract and retain workers, said Lenny Sanicola, the practice leader in employee benefits for WorldatWork, a nonprofit human resources trade group. Businesses, too, are looking to head off any potential state or federal mandates, he said.

“If there is a way for them to make business decisions on their own in terms of benefits they’d offer, they prefer to do that and see what works best for the business,” Sanicola said. And “once you see one organization in your industry make the move, you have to decide from a benchmarking perspective and recruiting perspective how that would affect people coming to work with your organization.”

For Bill Foxburrow, a 33-year-old relationship manager for M&T’s commercial bank, the expanded policy at his workplace couldn’t have come at a better time. Foxburrow’s wife, Valerie, is expecting the couple’s fourth child Nov. 2, and he plans to take off the allowed two weeks to help care for the baby and other children, ages 5, 3 and 2.

“Things are pretty hectic in the first two weeks,” said Foxburrow, a 6-year bank employee. “There’s not a lot of sleep, and it’s all hands on deck. Knowing that the time will be there is pretty huge. … To have something available to me was unexpected and positive.”

Sanicola said he expects companies from a wider array of industries to start examining their parental leave.

“This is something that … will become more mainstream as more and more organizations begin to talk about … work-life and family priorities,” he said. “Society has evolved, and an organization attracting and recruiting talent has to keep that in mind.”

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